Global Forest Product Chains

The report analyzes the global commodity chain of forest products where China acts as the central processing hub, importing raw materials from developing nations and exporting finished goods to Western markets. It highlights a systemic failure in governance and sustainability, particularly in Mozambique and Russia, where weak tenure rights and corruption lead to illegal logging and forest degradation. Conversely, it notes that trade with New Zealand demonstrates a positive model where strong governance ensures sustainable plantation management. The document argues that China's own self-interest—specifically the need for secure, long-term fibre supply—should drive it to lead international efforts in sustainable forest management, improve its procurement policies, and support capacity-building in supplier countries.

• China occupies a central role in the global forest product commodity chain, acting as a manufacturing base that imports primary raw materials from developing countries and exports finished products to developed Western countries.
• China's reliance on imported wood has inadvertently exported unsustainable production problems to other countries, creating risks including insecurity of fibre supply, higher prices due to export taxes in countries like Russia, and a loss of market reputation in Europe and North America.
• In Mozambique, specifically Cabo Delgado, forest management is characterized by chaos and over-logging, driven by a lack of transparency in use rights, insecure tenure, and institutional failure to enforce laws.
• Chinese companies in Mozambique often operate with a lack of corporate social responsibility, participating in local corruption and employing workers under harsh conditions that violate the Mozambican Labour Law.
• In the Russian Far East, forest sustainability is undermined by rigid state ownership, inadequate law enforcement following administrative reforms, and widespread corruption where illegal logging is often a result of bribing officials.
• Trade with New Zealand serves as a positive example of a sustainable chain, where strong governance, clear tenure, and a focus on plantations enable the conservation of natural forests while supporting economic growth.
• The report identifies a 'vicious cycle' where trade liberalization negatively impacts countries with weak policies and institutions, while a 'virtuous cycle' occurs in those with robust institutions.
• China's import tariff structure, including zero tariffs on primary products like logs, is believed to have hindered the development of domestic processing industries in supplier countries like Mozambique.
• The report recommends that the Chinese government provide financial and technical aid to supplier countries to build forest governance and management capacity, specifically through the Sino-African Development Fund.
• To improve sustainability, China is advised to implement a robust sustainable wood product procurement program and adjust its VAT refund policies to discourage unsustainable production.
• China is encouraged to join international initiatives such as the EU's FLEGT licensing scheme and the REDD initiative to implement carbon accounting for forest management.

APA

Sun, C., Chen, L., Chen, L., Han, L., & Bass, S. (2008). Global Forest Product Chains. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/china_sd_forest.pdf

Chicago

Sun, Changjin, Liqiao Chen, Lijun Chen, Lu Han, and Steve Bass. Global Forest Product Chains. International Institute for Sustainable Development, 2008. https://www.iisd.org/system/files/publications/china_sd_forest.pdf.

Wikipedia

{{cite report |last1=Sun |first1=Changjin |last2=Chen |first2=Liqiao |last3=Chen |first3=Lijun |last4=Han |first4=Lu |last5=Bass |first5=Steve |title=Global Forest Product Chains |publisher=International Institute for Sustainable Development |date=June 2008 |url=https://www.iisd.org/system/files/publications/china_sd_forest.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{sun2008global, author = {Sun, Changjin and Chen, Liqiao and Chen, Lijun and Han, Lu and Bass, Steve}, title = {{Global Forest Product Chains}}, institution = {International Institute for Sustainable Development}, year = {2008}, month = jun, url = {https://www.iisd.org/system/files/publications/china_sd_forest.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }